Lao PDR: Sharing Experiences

on Post-WTO Accession UNESCAP, Bangkok, Thailand

11 July 2016

By: Bountheung DOUANGSAVANH

Deputy Director General

Foreign Trade Policy Department

Ministry of Industry and Commerce

Contents

1. Long Road to Joining WTO

2. Accession Negotiations and Results

3. Post-Accession Challenges and Solutions

4. Lessons Learned

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1. Long Road to Joining WTO

07/1997: Applied for membership.

02/1998: Working Party (WP) established.

03/2001: Submitted Memorandum on Foreign

Trade Regime.

– Multilateral track: 10 Working Party Meetings.

– Bilateral track: bilateral negotiations on goods and

services with 9 members.

02/02/2013: Full-fledged member of WTO (158th).

It took 15 years for a small country

likes Laos to join WTO.

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2. Accession Negotiations and Results (Multilateral Track)

Aim at clarifying compliance of Laos’ laws and

regulations with WTO principles.

Provided 10 sets of questions and answers (Q&As),

with more than 1,030 responses.

Action plans stating in details legislation to be

adopted and amended, and specifying steps,

timeframe and technical assistance needed.

More than 90 pieces of legislation were adopted or

amended, including 26 laws and 18 decrees.

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-

2. Accession Negotiations and Results (Multilateral Track)

The 1st WP (263 questions)

10/2004

The 3rd WP (159 questions)

11/2007

The 5th WP (50 questions)

07/2009

The 7th WP (136 questions)

06/2011

The 9th WP (48 questions)

06/2012

The 2nd WP (101 questions)

11/2006

The 4th WP (94 questions)

07/2008

The 6th WP (107 questions)

09/2010

The 8th WP (122 questions)

03/2012

The 10th WP (74 questions)

09/2012 5

Laos received transition periods as follows:

Telecom Independent Regulator: 2 years

To abolish reference price and fully implement CVA: 2

years

Trading Rights: 2 years

Official Gazette: 3 years

Trade Remedies: 5 years

To implement SPS/TBT Agreements: 2 years

To implement TRIPS: 4 years (but TRIPS extension for

LDC until 2021)

2. Accession Negotiations and Results (Multilateral Track)

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-

2. Accession Negotiations and Results (Bilateral Track)

Laos concluded bilateral negotiations on goods and

services with 9 members.

Japan

China

South Korea

Canada

Australia

EU

Chinese Taipei

United States

Ukraine

2010

2011

2012

4 members showed initial

interest : Dominican

Republic, Honduras,

India and Switzerland

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2. Accession Negotiations and Results (Bilateral Track)

Goods: average bound rates 18,8%

Agricultural goods: 19.3% (applied rates: 18.4%)

Industrial goods: 18.7% (applied rate: 10.0%)

Services: open 10 sectors and 79 sub-sectors

(from 160 sub-sectors)

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-

2. Accession Negotiations and Results (Bilateral Track)

Business

- Professional Service (7 sub-sectors)

- Computer Service (5 sub-sectors)

- Research & Development (1 sub-sector)

- Other businesses (9 sub-sectors)

Communications

- Courier Services (1 sub-sector)

- Telecoms Services (15 sub-sectors)

Construction Services (5 sub-sectors)

Distribution Services (4 sub-sectors)

Private Education Services (4 sub-sectors)

Environnent Services (5 sub-sectors)

Financial Services

- Insurance Services (4 sub-sectors)

- Banking & other financial Services (8 sub-sectors)

Hospital Services (1 sub-sector)

Tourism Services (3 sub-sectors)

Transportation Services

- Air transportation Services (3 sub-sectors)

Open 79 sub-sectors

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3. Post-Accession Challenges and Solutions (Internal Coordination)

After the accession, a new National Steering Committee for

Economic Integration (NSC) was set up to replace the one that

oversaw WTO accession negotiations:

– New NSC is a policy making level for international trade

policy: WTO, Regional, Sub-Regional and Bilateral.

– Chaired by DPM, Minister of MOFA; and

– Minister of MOIC, Deputy Chair.

The Foreign Trade Policy Department (FTPD) serves as

Economic Integration Secretariat.

Negotiating teams are formed by FTPD for negotiations under

WTO, Regional, Sub-Regional and Bilateral Agreements.

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3. Post-Accession Challenges and Solutions (Internal Coordination)

Reform in the organizational structure of FTPD to be more functionalized in divisions: Goods, Services, Multilateral (WTO), Bilateral, ASEAN for instance.

Form up the drafting team for legislation on trade remedies

Raising awareness for public and private sector on post- WTO accession and AEC.

Studying pros and cons of the impact of economic integration and seek expert opinion.

Sharing experience with neighboring countries on post accession.

Strengthening internal coordination.

Seeking TA aimed at legislation improvement and technical staff’s capacity building.

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3. Post-Accession Challenges and Solutions (Internal Coordination)

New Government - new chair of NSC to be appointed -

still in discussion within Government.

Internal coordination between ministries/agencies:

– Reform may mean bureaucratic winners and losers.

– Reform is a social concern, mindset problem: import is bad

while export is good.

– Government revenue concerns.

– Internal coordination between public and private sector:

Hesitance about economic reforms in general.

Not well cooperate with Government.

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3. Post-Accession Challenges and Solutions (Status of Commitments)

Completed activities/commitments:

– Abolishment of reference price.

– Official Gazette.

On-going activities/commitments:

– Telecom Independent Regulator: behind schedule

– Regulation on Trading Rights: behind schedule

– Law on Safeguard (to be completed by June 2017): on

schedule

– Law on Anti-Dumping and Countervailing Measures (to be

completed by October 2017): on schedule.

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4. Lessons Learned

Clear political will during accession negotiations and

for post accession is needed.

Keeping reform momentum achieved during accession

negotiations: be prepared to implement the

commitments in advance, not wait until the deadline of

transition periods.

Keeping those personnel trained and involved in the

negotiations for post accession.

Strengthening internal coordination.

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4. Lessons Learned

Be active in different negotiating groups in Geneva, but

considering limited resources, it is important to focus on

specific interest and needs of the country.

As a land-locked LDC, Laos attaches great importance to trade

facilitation, especially the Trade Facilitation Agreement (TFA):

– Ratified TFA on 29 September 2015 (18th member, 2nd LDC,

3rd LLDC and 3rd ASEAN).

– Submitted Category A Notification on 15 September 2015,

and is ready to submit Category B and C.

Laos also ratified the Protocol amending TRIPS Agreement on

29 September 2015.

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4. Lessons Learned

Mobilization and Effective Utilization of Technical Assistance,

with full ownership:

USAID LUNA II (2014-2018) : Legal reform for post-WTO

accession and implementation of the commitments.

IDEAS Centre (2013-2016), with funding support from SECO

(Switzerland): Formulation of negotiation strategies in DDA and

implement the commitments.

TDF2 (2013-2017): Support post-WTO accession.

GIZ RELATED Project: Support the implementation of AEC.

ADB, FAO: SPS/TBT related issues.

ACWL: Legal compliance (upon request).

WTO, EIF, WB, ITC, UNCTAD etc.: Raising awareness and

addressing productive capacity constraint.

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Multilateral Negotiations

Signing bilateral deal with China

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Signing bilateral deal with EU

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Signing bilateral deal with Australia

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Signing bilateral deal with the US

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Signing bilateral deal with Chinese Taipei

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GC Meeting Approving Laos’ Accession Package

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After Signing of the Protocol of Accession

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Full-fledged Membership of Laos in WTO

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Kob Jai

(Thank you)

For further information:

Multilateral Trade Policy Division

Foreign Trade Policy Department

Ministry of Industry and Commerce

Lao PDR

Tel.: +856-21-450065

Fax: +856-21-450066 www.laoftpd.com

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